Happy New Year! As we think about what’s ahead in 2024, we’re reminded that hiring is a product of business performance and business performance is a product of market conditions and financial health.
So where are we as we kick off 2024? At the end of Nov 2023, there was an all-time high of $5.8 trillion sitting in money market funds given the rise of interest rates. Private equity firms are sitting on more than $2 trillion in dry powder, uninvested capital waiting to be deployed, and public companies in the S&P 500 have a combined $2.4 trillion in cash. In addition, inflation is steadily coming down and the Fed has signaled that it will start to ‘lower’ rates this year. As a result, the S&P 500 has been near all-time highs. While all of this is true, it certainly feels like we’re still in for a bumpy ride in the talent world. There are some companies that are still under pressure and prior capital raised is starting to run thin with less appetite for investing into unprofitable businesses. Other segments of the market are on fire, looking at you AI, and flush with cash to build for the future.
Regardless of which position your company is in, we’re anticipating that this will be a year that more recruiting opportunities start to open up — we’re already seeing it within our community. As a result, it’s important to have meaningful career and performance conversations with your team and get them excited about the work ahead, and how they can continue to grow at your company.
But how do you conduct these conversations with success? One of the most common pitfalls we’ve seen is conducting these without clear expectations, structure and leadership alignment; leaders haven’t agreed and defined what success looks like at each level, and employees don’t understand what’s expected of them and how to grow.
For a successful outcome and to ensure you are conducting these conversations with consistency and fairness, we recommend investing in creating a career ladder: a structured framework that defines the expected level of knowledge, skill, and behavior for each job level based on set criteria.
When combined with meaningful career and development conversations with your manager, a career ladder establishes purpose, creates clarity, provides structure, gives direction for managers and employees, and ultimately aids in retaining top performers.
If you’re looking for a partner to either create this framework from scratch or revise an existing framework this coming year, for your people team or other org, we’d love to help!
